Other details in the TechCrunch report indicate Amazon is also building a second inexpensive smartphone that will launch later this year. That phone runs on software akin to the Fire OS in the Kindle Fire HDX.

TechCrunch derived part of its information from an anonymous Hacker News posting that said the model with 3D eye tracking is code-named "Smith."

The Hacker News posting said Amazon had hoped to launch the Smith 3D tracking phone already, but engineers encountered problems with both software and hardware and then some people working on the project left the company.

The hacker post also indicates the front of the Smith phone has four cameras -- one at each corner of the device -- to track a user's head and eyes and then move the user interface accordingly to give an impression of 3D.

Another feature would provide image recognition software that allows a user to photograph a real-world object and compare it to an Amazon product database for a potential purchase.

TechCrunch reported that the two phones are being developed in a locked-down facility and can't be taken from the building.

Amazon didn't comment on the report.

Analyst Jack Gold, of J. Gold Associates, said it isn't surprising that Amazon is reported to be working on two smartphones. "Amazon sees the mobile platforms as a window into its service, just as it already does with its Kindle tablets," he said.

It's not critical for Amazon to make smartphones, he said, but with Apple, Google and, more recently, Microsoft, in the smartphone space, it would make sense for Amazon to join them, but "gear it towards a uniquely Amazon experience."